MA Average Diluted Shares Outstanding (Quarterly) data by YCharts .
At 28 times trailing earnings, MasterCard may not appear to be an obvious bargain, but since 85% of transactions worldwide still occur using cash or check, I think it is well positioned for decades of double-digit growth ahead. This company's rock-solid balance sheet, stellar management team, and highly scalable business model make this a great stock for future retirees to consider.
Down but far from out for long-term investors
Tyler Crowe : What investor doesn't want a steady stream of income coming from their portfolio in retirement? The only thing that investors likely want more is a higher yield on that investment. One way to get that higher yield without exposing yourself to the risk of dividend cuts is to look for great companies that are out of favor right now. One company that fits the bill today is oil rig driller and lessor Helmerich & Payne (NYSE: HP) .
By most measures, Helmerich & Payne doesn't fit into the typical category of a company that would be a steady dividend payer. It's in a very competitive market where pricing power is very much in the hands of its clients. What sets Helmerich & Payne apart in this industry is how management has handled the company over the years that has allowed it to remain strong through the ups and downs of the industry cycles. Even today, after watching oil prices drop for more than two years and drilling activity come to a near standstill, Helmerich & Payne still has more cash on hand than debt outstanding and continues to generate enough free cash flow to cover its dividend payments. This conservative approach has allowed the company to maintain a streak of 42 years of ever-increasing payouts to shareholders.
With a dividend yield today of 4.3% and a price-to-tangible book value of 1.48 times, it's not the absolute cheapest Helmerich & Payne has been in the recent downturn, but the two metrics suggest that the company is quite undervalued compared to its long history. Anyone looking to add a cheap income-paying stock to their retirement portfolio should look closely at this company.
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Brian Feroldi owns shares of MasterCard. Dan Caplinger has no position in any stocks mentioned. Tyler Crowe owns shares of HCP. The Motley Fool owns shares of and recommends MasterCard. Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
